Chinese Consumer Fail to Get the Message

On : April 18, 2019

In
spite of surveys that measure consumer sentiment directly, probably the single
best way to track consumer sentiment is by watching the growth of retail
sales. If consumers are buying, they are
confident. And the Chinese consumer have
been buying through the winter noise about trade wars and its assumed negative
effect on the Chinese economy. They
apparently have not gotten the message.
Source: www. Tradingeconomics.com; National Bureau of Statistics of
China

China’s Manufacturing Makes a Comeback

On : April 9, 2019

Last year’s Manufacturing
Index ended in decline, which rolled into January. The last two months have reversed the decline
to a point where March turns in the best number since July of last year. Every time a sector of the Chinese economy is
counted out, it seems to recover in relatively short order. This comeback was fueled by growth in new
orders – mostly exports. They were strong enough to overcome slight declines in
purchasing activity, finished goods inventory and slight increases in input
costs.

According to Zhengsheng
Zhong, director of macroeconomic analysis at CEBM Group, a subsidiary of Caixin
manufacturer’s are seeing a positive future, “Overall, with a more relaxed
financing environment, government efforts to bail out the private sector and
positive progress in Sino-U.S. trade talks, the situation across the manufacturing
sector recovered in March.” Source:
China Caixin,CNBC

Smart Subscribers Pass 1.3 Billion in China

On : April 2, 2019

February saw a 38% drop in the number of new mobilesubscriptions compared to January. One explanation might be the widely reported drop in China’s iPhone sales, though it was also reported that local brands have taken up much of the slack. Apple may not have merely lost a month, it could be a long term loss of market position. Meanwhile, the number of smart subscriptions moved passed the 1.3 billion mark, emphatically emphasizing China’s status as the largest mobile market in the world. Sources: China Mobile, China Unicom, China Telecom

China’s Service Sector Declines Modestly

On : March 26, 2019

February’s
service sector declined modestly while maintaining a solid underpinning for the
Chinese economy. It sits just below the
13-.month average of 52.9. Though the
manufacturing sector has shown weakness the service sector remains comfortably on
the positive side of this scale. Projected GDP reflects this modest downturn. Source: China Caixin

Manufacturing Rebound

On : March 19, 2019

In
a lesson on why one cannot generalize from one data point, we note the strong
rebound in the Purchasing Manager’s Index for February after a dismal
January. Given the talk about declining
Chinese growth resulting from the trade wars, it was natural that the steep PMI
drop in January would be viewed as more than it appears to have been. We’ll have to watch next month’s number for
for a pattern. Was January an anomaly?
Or was it the beginning of a volatile period? Source: China Caixin

China’s Un-Phased Consumer

On : March 12, 2019

In
retrospect, one can explain the reason Chinese consumers have shown revatively little
reaction to existing trade issues or the decrease in local manufacturing. It is the steady decline of consumer prices
over the last three months. As far as
the man-on-the-street is concerned, life has gotten modestly easier through
that period. January’s prices were the
lowest since January of last year. Source:
www. Tradingeconomics.com; National Bureau of Statistics of China

China’s Inflation Rate Declines for the Third Month

On : March 7, 2019

Though consumer prices in China went up 0.5% in January,
overall inflation continued a three month decline. Inflation rates haven’t been this low since
January of last year. This may be a
partial explanation as to why Chinese consumers remain positive in spite of
real contraction in the manufacturing sector.
The downward pressure represents a form of stability that, due to trade
tensions, may not be reflected in other parts of the economy. Source: Trading
Economics; National Bureau of Statistics, China

China is Approaches 1.3 Billion Smartphone Subscribers

On : February 26, 2019

The
big smartphone news from last month was that Apple’s phone sales in China had crashed
in the last quarter. But that didn’t
mean that smartphone sales in China had turned negative. The carrier numbers
from January imply that Chinese manufacturers have replaced Apple sales and then
some. Smartphone subscribers in China
hit 11.3 million in January, which is a half million above the 12-month average
for last year. Sources: China Mobile,
China Unicom, China Telecom

Chinese Manufacturer’s Bail Out in January

On : February 19, 2019

The
precipitous -3.8% drop compared to November’s number is the largest decline we
have seen since we’ve been watching and the lowest this Index has fallen since
February of 2016. Obviously, the trade
wars have taken hold and are now affecting the judgment of purchasers in the
manufacturing sector. Index numbers
below 50 are on the negative side for futures.
Notably, the January number for the Services sector, as reported last
week, remianed at a healthy 53.3. Source: Markit Economics

China’s Economy is Down, but Not Out

On : February 12, 2019

The pattern through 2018 is now clear. The Chinese GDP has declined 5.9% when
compared to the fourth quarter of 2017.
Still it is an economy that is growing at a healthy rate in spite of the
effects brought on by the trade turbulence. Sources: Trading Economics;
National Bureau of Statistics, China